For the average bond investor, getting into a game of predicting where interest rates will head over the near-term is likely a losing proposition. At the beginning of 2014 if you had followed the popular consensus and avoided bonds with the 10-Year … [Read more...]
Accrued Market Discount – What You Need to Know
In last week’s article, “10 Intermediate-Term Bonds Yielding Over 4%,” I presented 10 corporate bonds with yields-to-worst and current yields of at least 4%, maturities of less than 10 years, and credit ratings no lower than Ba3/BB-. Moreover, nine … [Read more...]
Yield to Call – What it is and how It Works
Yield to call measures what the yield on a bond will be if it is called at the earliest possible call date. Many bonds are callable, meaning they can be redeemed by the issuer prior to the bond’s maturity. Callable bonds are often issued to … [Read more...]
Do SandRidge Energy bonds yield 6% or 8%?
One my favorite bond analysts, Rom Badilla of Bondsquawk.com, recently recommended the high yield bonds of Sandridge Energy, a large producer of oil and natural gas. However, a person not very familiar with technical terms of the bond market might … [Read more...]
Don’t Be Scared to Purchase Individual Junk Bonds – Redux
By: The Financial Lexicon (October 1st, 2012) As an author of financial articles, I am accustomed to receiving all sorts of feedback on my writings. Occasionally, a reader may be confused about something I write, and I respond in an attempt to … [Read more...]
How to Choose a Municipal Bond for Income
Many investors prefer individual municipal bonds over municipal bond funds. What attracts them to individual municipal bonds is the income stability and lack of interest rate risk when individual bonds are bought and held to maturity. (You can … [Read more...]
The “Risk Tolerance” Mistake That Could Lead You To Financial Disaster
I read a number of great personal finance blogs including the Oblivious Investor written by Michael Piper. Recently, I found a guest post by him on the Bible Money Matters blog, called How To Determine Your Risk Tolerance. In the article, he … [Read more...]
Bond Trading – How to Trade Bonds Electronically
Bond trading is not like trading stocks. Bond trading technology and access has not developed as quickly as other markets. Electronic platforms with real time quotes which are the standard in other markets are the exception in the bond market. What … [Read more...]
How To Choose A Corporate Bond For Income
One of the main reasons to buy individual corporate bonds instead of bond funds is income. While both bond funds and individual corporate bonds deliver income, an individual bond will provide a fixed dollar payment on a regular basis, which does not … [Read more...]
Electronic Muni Bond Trading: Better than 2 Cans on a String
In order to research an upcoming piece on which broker has the best bond research, I opened small accounts at the 4 largest electronic brokers, each with $1000. Because the process is easier for personal accounts than it is for company accounts, I … [Read more...]
3 Things to Consider When Buying Premium Bonds
By: The Financial Lexicon (July 2012) In this era of ultra-low interest rates, it has become harder to find higher quality bonds trading at discounts to par. This is to be expected. After all, as interest rates decline, bond prices rise. With … [Read more...]
Treasury Auctions 101
As you can imagine, the US government has a tremendous amount of treasuries to sell each year, both from refinancing maturing debt and to finance government deficits. The US Treasury Department is responsible for selling this debt. All told, the US … [Read more...]
David Merkel on Bond Ladders
By David Merkel of AlephBlog.com I received the following from a reader: My primary motivation for writing to you is this post by Jeff Miller. In my mind, you are the foremost expert blogger when it comes to bonds so I wanted to get your … [Read more...]
Why Bond Laddering is a Bad Idea
By Barry Rabinowitz of BER Financial Group Individual investors have always worried about investing in the bond market at the wrong time, since a subsequent rise in interest rates would result in a decline on the market price of their bonds. This … [Read more...]
How to Buy Municipal Bonds and Get the Best Price Possible
If you want to know how to buy municipal bonds, you should start by getting to know the retail order period, as this is where you are likely to get the best price. The majority of new municipal bond issues have a retail order period where non … [Read more...]
Buying Bonds – A How to Guide
Before buying bonds for the first time, it's important to understand the basics. Here is a video summary of what you need to know to buy bonds. You can find the longer text version below this video: View Lesson … [Read more...]
Can You Trade Bonds on Leverage?
As long as you are a suitable investor (can trade with leverage on stocks), you are legally allowed to trade bonds with leverage. What is leverage? Leverage is using borrowed money to increase your investment buying power. Where an investor with … [Read more...]
Can You Short a Bond?
Here is a video covering the ins and outs of shorting bonds. The longer text version is below the video. Embed this video in your website [vimeo]https://vimeo.com/50864823[/vimeo] How to short bonds using ETFs It is very difficult to make … [Read more...]
Where To Buy Bonds?
There are 3 Places You Can go to Buy Individual Bonds: TreasuryDirect.gov You can buy Treasury Bills, Notes, Bonds, and TIPS directly from the US Government. This is a good option ONLY if only plan to by Treasuries and hold them to … [Read more...]
Bond Prices – Where to Find Bond Prices and Quotes
There are several places where you can find free delayed bond prices. Generally speaking, the prices are delayed by 5 - 15 minutes. As most bond prices don’t move as quickly as stocks (with the exception of Treasury and Agency bonds), a delayed … [Read more...]